156 replies to this topic

[Padge]

They were loss making and subsidised by the government - that's why they were privatised.

Not true (for all of them)

[John Rhino]

Don't be so daft. Have you had a bad day at the office/factory/pub?

No not really!

I just realise what a con privatisation is. The shareholders get all the profits, bleed it dry, and the state, ie us as taxpayers are left to pick up the tab.
Its happened in everything from railtrack to breast implants.

The NHS is being crippled by PPE and Virgin Health and American companies are circling like vultures waiting for the sell off that's coming and you call me daft?

[Padge]

I make widgets for the government, widgets cost £1 each to make, government sells widgets to public at £1 each. I get paid, government loses no money public gets good price.

I make widgets for private company, widgets cost £1 each to make, private company sells widgets to public at £1 + shareholders cut of 25%, I get paid, government gets no money public pays 25% more for exactly same widget.

[Northern Sol]

As an analysis of the economy works that's not very good to say the least.

You didn't factor in the different efficiencies of the different sectors, tax or pay levels. Nor does investment appear in your model.

If your the real world was like that then the USSR would have been an economic super-power.

edit: and no consumption either, you just assume that money paid out to shareholders disappears.

Edited by Northern Sol, 19 October 2012 - 09:21 PM.

[Padge]

As an analysis of the economy works that's not very good to say the least.

You didn't factor in the different efficiencies of the different sectors, tax or pay levels. Nor does investment appear in your model.

If your the real world was like that then the USSR would have been an economic super-power.

edit: and no consumption either, you just assume that money paid out to shareholders disappears.

Trickle down Reagonomics doesn't work, they don't trickle it down they squirrel it.

Edited by Padge, 19 October 2012 - 09:27 PM.

[Northern Sol]

Trickle down Reagonomics doesn't work, they don't trickle it down they squirrel it.

What doesn't work is trying to spread poverty evenly. It's better to be poor in a rich country than poor in a poor country.

[Padge]

What doesn't work is trying to spread poverty evenly. It's better to be poor in a rich country than poor in a poor country.

Its just better to be rich, and that's as stupid a statement as yours.

[Northern Sol]

Its just better to be rich, and that's as stupid a statement as yours.

Visit a 3rd world country and then tell me it's stupid.

[Padge]

Visit a 3rd world country and then tell me it's stupid.

Visit some oil rich middle east countries and see how the poor compare there to the rich there.

[Severus]

The same place any profit comes from. You sell something for more than it cost you to make or source.

When you make a profit, you can pay dividends to your shareholders, this is where you get your capital from to invest in new technology.

Which comes back to my original point. Any surplus (I won't call it profit) that a nationalised industry gained gets invested back in the service/infrastructure. In the privatised case this get paid to shareholders/directors. Net result, we lose, a very few gain.

[Northern Sol]

Visit some oil rich middle east countries and see how the poor compare there to the rich there.

And?

Since when is relative poverty worse than absolute poverty?

There are hundreds of thousands of people in poor countries like the Philippines who move continents simply to be poor in oil rich countries, I've yet to hear of a poor Saudi who moved to the Philippines to enjoy the privilege of working for a minimum wage job over there.

[Northern Sol]

Which comes back to my original point. Any surplus (I won't call it profit) that a nationalised industry gained gets invested back in the service/infrastructure. In the privatised case this get paid to shareholders/directors. Net result, we lose, a very few gain.

Nationalised industries don't produce surpluses, they produce losses that the taxpayer has to cover.

Shareholders / directors pay tax and buy things. The money doesn't disappear, it circulates.

[Padge]

And?

Since when is relative poverty worse than absolute poverty?

There are hundreds of thousands of people in poor countries like the Philippines who move continents simply to be poor in oil rich countries, I've yet to hear of a poor Saudi who moved to the Philippines to enjoy the privilege of working for a minimum wage job over there.

And of course thousands leave this country each year for a poorer life abroad in Canada, Australia etc., they just can't wait to get out there and poorer.

[Padge]

Nationalised industries don't produce surpluses,

That's boolox

[Trojan]

Railfares in Germany and France are much cheaper than here. In the "bad" old BR days the taxpayer was subsidising BR to the tune of £1bn PA. Now in the "good" privatised days the taxpayer is subsidising the private companies to the tune of £4bn. Two of these companies are owned by SNCF and Deutch Bahn. Thus French and German rail passengers get cheap fares courtesy of the British taxpayer.
An incoming government wouldn't need to renationalise the railways, just wait for the franchise to end and not renew it. The state company operating East Coast is currently returning £200m pa to the taxpayer.
http://www.independe...ts-8181255.html
Nothing to stop the same thing happening on all other main routes - leave the private companies to run the feeder routes.

[Severus]

Nationalised industries don't produce surpluses, they produce losses that the taxpayer has to cover.

Shareholders / directors pay tax and buy things. The money doesn't disappear, it circulates.

What a load of tosh. Funny how the money circulates into the pockets of the few.

[Northern Sol]

And of course thousands leave this country each year for a poorer life abroad in Canada, Australia etc., they just can't wait to get out there and poorer.

Amazingly those countries are rich, when thousands of poor Britons leave to go to do minimum wage jobs in third world countries you will have a point.

[Northern Sol]

What a load of tosh. Funny how the money circulates into the pockets of the few.

It's funny how living standards have risen dramatically for all since the Industrial revolution since private industry concentrates wealth in the hands of the few and none of this trickles down to the poor. You make statements that have no theoretical justification in economics and are contradicted by empirical data.

Still using words like "tosh" and "boolox" are obviously far more impressive than actual facts.

Edited by Northern Sol, 20 October 2012 - 06:43 AM.

[Severus]

It's funny how living standards have risen dramatically for all since the Industrial revolution since private industry concentrates wealth in the hands of the few and none of this trickles down to the poor. You make statements that have no theoretical justification in economics and are contradicted by empirical data.

Still using words like "tosh" and "boolox" are obviously far more impressive than actual facts.

oh dear. Do tell me what nationalised industries existed prior to the industrial revolution. The industrial revolution was a time when the majority of the poor lived and worked in terrible conditions, suffered ill health and a the very few became very rich. The Victorian era did see some philanthropic behaviour from some industrialists who saw that treating the workforce well and providing housing and education improved productivity, but these were in the minority and the fact that living conditions have improved since those times is not because of a trickle down effect but because of the liberal movement.

I'll put this in simple terms. Consider two cases where there is x amount of money in the economy. The first case is where an essential service is nationalised. After costs, any additional money that is left over is fed back into improving the service. In the other case of the privatised service, any additional profit goes into the pockets of the shareholders. Trickle down economics does not work and just increases the gap between the rich and poor (e.g. Look at the US). So all privatisation does it make a few richer and takes money out of the service.

I am not a communist, a free market is essential for the economy. What I do think is that essential services should be owned and run by the government and the private sector cannot be trusted with them.

[Griff9of13]

Like i said earlier, to work in the interest of the consumer the privatised services need to offer free and open competition in order that service be improved and prices driven down. That's how the free market works. However, in the case of the privatised former nationalised industries there is little or no free and open competition at the point of delivery to the consumer but instead a group of regional monopolies. That is why privatisation has, in my eyes, failed it is an artificial pretence of free market economics. Apart from the telecoms industry, where there has been free and open competition at the point of delivery and choice of goods and services is high, and costs to the user relatively low.

Trying to artificially force one business model onto another, completely different type of business that does not suit that business model never works, it just ends up with confusion and muddle. Just look at schools and the NHS who are currently being forced into the same straightjacket. Schools and hospitals are not profit generating businesses, stop trying to force them into trying to behave like industrial businesses.